HKSE-listed Yunfeng Financial Group has launched a mobile app named Youyu Robo Advisor in Hong Kong.
The app aims to help investors allocate global assets more efficiently via a bottom up approach for fund selection, leveraging the capabilities of top tier fund managers to provide customized asset allocation solutions.
According to the company behind the app, Youyu Robo Advisor differs from other robo advisors, which purportedly adopt a top-down asset allocation style, where underlying assets are categorized by asset classes and statically allocated on passive index-tracking exchange traded funds (ETFs).
The Youyu Robo-Advisor management team has purportedly sourced professionals from a number of global top asset management firms. The team has established a database composed of approximately 10,000 funds and has developed a fund scoring mechanism that rates funds against five indicators, namely short-term and long-term performance; abilities of the fund manager; capital flows; and third party ratings.
Based on these findings, the team has carefully selected a few hundred funds that have been made available on the Youyu Robo-Advisor app. The Youyu Robo-Advisor team has signed formal agreements with 13 top tier asset managers around the world which manage 343 funds that are easily traded on the platform.
Aside from the market beta returns the Youyu Robo-Advisor app can generate, the introduction of top tier fund managers aims to allow investors to capture alpha generated by these managers’ active management strategies. Despite the fact that fund managers are confronted with the same asset classes and market environment, their management styles and market views vary. With this in mind, the app provides investors with more diversified and customized recommendations based on its actively-managed fund database.
The first batch of funds available on Youyu Robo-Advisor are provided by the following fund managers (in alphabetical order): Amundi Hong Kong Limited, AXA Investment Managers Asia Limited, Baring Asset Management (Asia) Limited, Franklin Templeton Investments (Asia) Limited, Income Partners Asset Management (HK) Limited, Invesco Hong Kong Limited, Manulife Asset Management (Hong Kong) Limited, Neuberger Berman Asia Limited, Pimco Asia Limited, Pinebridge Investments Asia Limited, Principal Investment & Retirement Services Limited, Robeco Hong Kong Ltd, and T.Rowe Price Hong Kong Limited.
Investors first need to go through a risk assessment process before they purchase funds on Youyu Robo-Advisor. After undergoing the risk assessment process, investors are redirected to a Model Portfolios landing page, which suggests various asset allocation strategies based on their different risk assessment results.
Youyu Robo-Advisor’s robo-advisory team select and allocate the Model Portfolios based on machine learning algorithms. The funds are selected from Youyu Robo-Advisor’s fund database and are screened against a set of stringent fund performance standards. By exercising control at every step of the fund selection process, the app ensures that the best funds are selected.
For ordinary investors, Youyu Robo-Advisor’s Model Portfolios allows orders to be placed with a single click, making the intelligent allocation of global assets easy.